Further Evidence on Returns to Schooling by Establishment Size

Stolzenberg (1978) has argued thatfor white male employees the effect of schooling on logearnings is greater in larger establishments. We replicate Stolzenberg's study using the 1979 Current Population Survey. This survey includes information on establishment size and provides a much larger sample size to work with. Our results do not indicate a positive establishment size/schooling interaction. To the contrary, when Stolzenberg's (1978) model specification is used, ourfindings suggest that the interaction may be negative. We explore the sources of this discrepancy and are skeptical of the conventional wisdom that returns to schooling increase with establishment size.